The Iran issue and the West Asia situation figured prominently in discussions on the second day of the Non Aligned Movement Summit. Delegates of more than 100 developing countries urged for unconditional negotiations to resolve the standoff over Tehran's controversial nuclear programme.

After hotly debated closed-door meetings, officials at the Summit issued separate resolutions on Iran and Palestine and fine-tuned a draft final document, which the heads of state and government are to adopt on Saturday.

The six-day gathering of NAM nations brings together almost 116 leaders from developing countries, including Prime Minister Manmohan Singh, Pakistan President Pervez Musharraf.

Iranian President Mahmoud Ahmadinejad, who has defied UN demands that he halt uranium enrichment, is also slated to attend the meeting.

Heads of state and government will start their talks on Friday, four days after the preparatory meetings.

The summit is officially led by an ailing Fidel Castro, 80, but it was not known if he would take part in any public summit activity.

On Iran, the officials updated a resolution adopted by a NAM meeting in May in Putrajaya, Malaysia, but added a paragraph stating the need for an 'unconditional resumption of dialogue'.

The statement had said that any country had the right to use nuclear energy and welcomed what it said was Iran's 'voluntary confidence-building efforts' aimed at resolving the issue.

A document demanding that Israel withdraw from the West Bank, stop its 'aggression' in Gaza and release jailed Palestinian officials was also discussed at the meeting on Tuesday.

Officials said the delegates dropped a proposed paragraph that called the Israeli actions 'war crimes for which the perpetrators must be held accountable and brought the justice'.

The NAM draft declaration condemns Israel's invasion of Lebanon and hails the Lebanese people's 'heroic resistance to the Israeli aggression' and demands that Israel compensate the Lebanese government and people for the deaths, injuries and destruction the war caused.

On terrorism, Iran, Syria and North Korea want to broaden the world's definition of 'terrorism' to include the Israeli invasion of Lebanon and the US occupation in Iraq.

The NAM draft declaration condemns 'terrorism in all its forms', especially violence that targets civilians.

Terrorism should not be associated with any religion or nationality, said the draft, pointing at US President George W. Bush's phrase.

Member countries 'totally reject the use of the term 'axis of evil' by a certain state to target other states under the pretext of combating terrorism'.

In a draft of the summit's final document, NAM members also called for promoting 'all human rights and fundamental freedoms for all'.

The Summit also saw fierce lobbying by Venezuela and Guatemala for a seat on the UN Security Council. Caracas claimed it had locked in the votes to get a seat.

Raul Castro, who is temporarily replacing his brother Fidel as Cuba's president, made his appearance at the summit and insisted that his sibling was still giving orders.

The Group of 15, which consists of Brazil, Chile, India and Egypt among others, also held its meeting stressing on boosting South-South cooperation.